International Journal of Management Sciences and Business Research Volume 2, Issue 4- ISSN (2226-8235)

Determinants of profitability of Non Bank Financial Institutions:

Evidence from Bangladesh
Professor Dr. R. K. Raul
*
Md. Sogir Hossain Khandoker Dean, Department of Business Administration
Associate Professor, Department of Finance Assam University, Silchar, India
Jagannath University, Dhaka 1100; & S. M. Galibur Rahman
Ph.D fellow, Department of Business Administration BBA, Department of Finance,
Assam University, Silchar, India Jagannath University, Dhaka 1100

*Corresponding author

Abstract: This project examines the determinants of profitability of Non Bank Financial Institutions
(NBFIs) of Bangladesh in the context of strengthening and aligning the financial sectors with that
of operating at the global level. Profitability provides a clue of effectiveness of firms’ decisions and
operational policies. The key factors emerged from the study like; liquidity, operating expenses,
capital structure, total assets, etc significantly influence the financial performance of NBFIs.
Different Statistical techniques such as correlation matrix, multiple regressions, Run test, and K-W
test for randomness were used for the analysis of secondary data. The study highlighted the
necessity of strategic financial decision of NBFIs in the emerging economy like Bangladesh to gain
competitive edge in the changing global financial arena.
Key words: profitability, operational efficiency, capital structure, competitive edge.

1.00 Introduction 2.00 Objective of the study

The financial performance of this sector has a
colossal economy of the country. Typically
financial sector refers to mainly banking sector
any of the country. The NBFIs are a special type
of financial institutions provides a host financial
service like; credit guarantee in international
business, export-import loans, project finance
and consultancy, foreign exchanges etc besides
arranging long term loans for the industry. The
contribution of this sector towards the economy
across the globe increased many folds and
generated curiosity amongst the investors.
Consequently, the financial performance of this
sector is under the scanner of the stakeholders
particularly in the context of present global
financial crisis which seems to be immune to
any policy measures. As the empirical studies
suggest numbers of research works have already
been accomplished on profitability aspect of
banking sector but research work in respect of
financial performance of the NBFIs in
Bangladesh in the post financial crisis regime is
at a nascent stage.
The objectives of our research are as follows:
(a) To identify the major financial features
affecting the profitability in the NBFIs of
Bangladesh and ,
(b) To evolve financial strategy for the NBFIs
in the context global financial crisis
3.00 Research Methodology:
a) Data source: The research is empirical in
nature. We followed judgmental sampling with
sample size consisting of all listed NBFIs in
Bangladesh. The data for this study was
gathered from the audited annual financial
reports published by the listed 22 companies
(NBFCs or NBFIs give reference). Further,
other sources like annual report, magazines,
brochures, journals, newspapers; websites, etc.
were considered whenever found necessary.
b) Tools for Analysis: For processing the data,
descriptive statistics, simple correlation and
regression analysis and correlation matrix in
some cases were used for better understanding
of interrelationship and effectiveness of

http://www.ijmsbr.com Page 31
 International Journal of Management Sciences and Business Research
variables. Statistical tests with the help of SPSS
were conducted at 5% level of significance.
c) Variables for the study
To assess the intricacies of profitability and
performance of NBFIs following dependent
variable and the independent variables were
considered:
d) Limitation
Limited access to the data is the prime limitation
Dependent Variable Independent Variables
Financial 1. Total Assets (TA),
Performance 2. Total Liabilities (TL),
1. Net profit (NP) 3. Net Worth (NW),
4. Term Deposit(TD),
5. Operating Revenue(OR),
6. Operating Expense(OE)
of this report, as the prime sources of data is the
annual reports. Besides, scarcity of relevant
literature is major hindrances of the report.
Findings and inferences of the study will only
be applicable for the conditions which prevailed
during the period for which data were taken.
4.00 Literature Review
Several studies both in the country and abroad
were undertaken to know the intricacies of
profitability and its determinants. But the fact
remains that, most of the researches have been
conducted on banking industry. So, literature
regarding profitability of NBFIs in Bangladesh
in particular is at embryonic stage. An attempt is
made hereunder to high light the contextual
references for the area under study.
Fadzlan Sufian, and Roy faizal Razali Chong
(2008) examined the determinants of
profitability of Philippines banks during the
period 1990–2005. Their empirical findings
suggest that all the bank-specific variables have
statistically significant impact on bank
profitability. They also found that size, credit
risk, and expenses, preference behavior are
negatively related to banks' profitability, while
non-interest income and capitalization have a
positive impact. According to their analysis
inflation has a negative impact on bank
profitability, while the impact of economic
growth, money supply, and stock market
capitalization have not significantly explained
http://www.ijmsbr.com
Volume 2, Issue 4- ISSN (2226-8235)
the variations in the profitability of the
Philippines banks.
Shah-Noor Rahman and Tazrina Farah
(2012), in their research paper “Non Bank
Financial Institution‟s Profitability Indicators:
Evidence from Bangladesh” examined the
indicators of the profitability of firms in the Non
Banking Financial Institution (NBFIs) industry
of Bangladesh. The study established a
relationship between independent variables like;
Current Assets, operating expenses, Long term
liability, Interest Income, and Operating revenue
and dependent variable; Net Profit (NP). It was
observed that firms‟ Liquidity and operational
efficiency has significant impact on Profitability
of Non Bank financial sector in Bangladesh.
James W. Scott and José Carlos Arias (2011)
in their study” Banking profitability
determinants” surveyed top five bank holding
companies in the United states and concluded
that determinants of profitability of the banking
industry include positive relationship between
the return of equity and capital to asset ratio as
well as the annual percentage changes in the
external per capita income. There was also a
virtual consensus identified concerning the
effect that the internal factor of size as measured
by an organization‟s total assets had on its
ability to compete more effectively, even in
times of economic downturns.
Christos K. Staikouras & Geoffrey E. Wood
(2011) examined the factors that that influence
the profitability of financial institution in their
research paper “The Determinants of European
Bank Profitability”. Their main finding was “the
rate of return earned by a financial institution is
affected by numerous factors. These factors
include elements internal to each financial
institution and several important external forces
shaping earnings performance. The type of
explanation would determine possible policy
implications and ought to be taken seriously”.
Their paper quantifies how internal
determinants (“within effects” changes) and
external factors (“dynamic reallocation” effects)
contribute to the performance of the EU banking
industry as a whole in 1994-1998.
Page 32
 International Journal of Management Sciences and Business Research
Balchandher K. Guru, J. Staunton & B.
Shanmugam (2009) in this research paper
“Determinants of commercial bank profitability
in Malaysia” examined to what extent are the
profitability performance disparities due to
variations in management controllable internal
factors and external factors. He took net profit
as his dependent variable and Asset
Composition, Capital, Deposit Composition,
Expenses Management, Liquidity, Firm Size,
Inflation Rate, Market Growth, Market Interest,
Market Share and Regulation as his independent
variable. He suggested that all variable has
significant relationship with net profit. And also
he added that in order to increase profitability
the Expense Management should be proper as
this variable significance is very high.
Demirguc-Kunt & Huizinga (2001) and
Bikker and Hu (2002) find a negative
relationship between stock market capitalization
and banks‟ profitability, it means that equity and
bank financing acts as substitutes rather than
complements. In case of the industry-specific
factors, the Structure- Conduct-Performance
premise point out that growing market power
enhances the profitability (income) of banks.
Antonina Davydenko (2011) surveyed about
3236 bank-quarter observations and concluded
that Ukrainian banks suffer from low quality of
loans and do not manage to extract considerable
profits from the growing volume of deposits.
Despite low profits from the core banking
activities
James W. Scott and José Carlos Arias (2011)
in their study” Banking profitability
determinants” surveyed top five bank holding
companies in the United and concluded that
profitability determinants for the banking
industry include positive relationship between
the return of equity and capital to asset ratio as
well as the annual percentage changes in the
external per capita income. There was also a
virtual consensus identified concerning the
effect that the internal factor of size as measured
by an organization‟s total assets had on its
ability to compete more effectively, even in
times of economic downturns.
http://www.ijmsbr.com
Volume 2, Issue 4- ISSN (2226-8235)
Nadim Jahangir', Shubhankar Shill and Md.
Amlan Jahid Haque (2007) surveyed 15
commercial banks in Bangladesh and found that
market concentration and bank risk do little to
explain bank return on equity, whereas bank
market size is the only variable providing an
explanation for banks return on equity in the
context of Bangladesh. They found that market
size and bank's return on equity proved to have
strong relationship. Also, a strong and
significant relationship was identified between
market size and bank's return on equity. It
suggests that capital adequacy is important for a
bank to be profitable.
To sum up, aforesaid reviews of literature
confirm that no significant studies have been
undertaken in the NBFIs in Bangladesh.
However, variables considered have contextual
reference to the study which is proposed to be
considered for the study.
5.00 Non Banking Financial Industry
(NBFIs) in Bangladesh Table: 1
Industry snapshot ( 5 October, 2012)s
Paid-up Capital 20438.96
(BDT million)
Number of listed 22
Company
Capitalization (BDT) 163,911,375,872
Sector PE 19.1
Sector Earning 8,714,468,569
Sector Beta 0.905396574
Source: www.stockbangladesh.com
Non-Bank Financial Institutions (NBFIs) are
those institutions that are licensed and
monitored under the Financial Institutions Act
of 1993 (FIA 93). NBFIs give long term loans
and advances for industry, commerce,
agriculture or housing; carries on business of
hire purchase transactions including leasing of
machinery or equipment; involves in business of
the underwriting or acquisition of, or the
investment or re-investment in shares, stocks,
bonds, debentures or debenture stock or
securities issued by the government or any local
authority; Finances venture capital; gives loan
for house building and property purchases and
uses its capital to invest in companies. The
Page 33
 International Journal of Management Sciences and Business Research Volume 2, Issue 4- ISSN (2226-8235)

major differences of NBFIs with commercial executed with each of the independent
banks are that the former cannot accept any explainers. In this model, the dependent variable
deposit which is payable on demand by cheques, is Net Profit and the independent factors are
drafts or orders drawn by the depositor and Total Assets, Net Worth, Total Liability, Term
cannot deal in foreign exchange. Starting from Deposit, Operating Expense and Operating
the IPDC in 1981, a total of 31 NBFIs are now Revenue. These variables are chosen in
operating in the country as of October, 2012. accordance with the eminence that in what
And out of 29 NBFIs 22 companies are listed at degree those can contribute to the determination
DSE and CSE. of profitability. In the second part of analysis, an
6.00 Empirical research & explanation investigation has been undertaken through
In this section, attempt has been made to multiple regression models. The dependent and
determine the association between company‟s independent factors are kept the same as in the
bottom line (Net Profit) and different simple regression model. The empirical study
operational variables as highlighted in the has been done as a whole to find out the extent
review of literature with appropriate statistical of relationship between dependent and
tools. At first, a simple regression model is independent variables.
6.01 Descriptive Statistics Table: 2
Descriptive Statistics
N Minimum Maximum Mean Std. Deviation Variance
NP 86 -6.E7 5.E9 4.26E8 7.822E8 6.118E17
TA 86 1.E9 6.E10 1.05E10 1.016E10 1.033E20
NW 86 4.E8 3.E10 2.15E9 4.256E9 1.811E19
TL 86 8.E8 3.E10 8.31E9 7.011E9 4.916E19
TD 86 6472378 3.E10 4.67E9 5.444E9 2.964E19
OR 86 6.E7 7.E9 7.94E8 1.144E9 1.309E18
OE 86 1.E7 1.E9 1.58E8 1.915E8 3.666E16
Valid N (list-wise) 86
In this table different descriptive statistics such as minimum, maximum, mean, standard deviation
and variance of all selected variable has been included.
6.02 Correlation Matrix Table: 3
Correlations
NP TA NW TL TD OR OE
** ** ** ** ** **
NP Pearson Correlation 1 .871 .943 .688 .789 .962 .675
Sig. (2-tailed) .000 .000 .000 .000 .000 .000
N 86 86 86 86 86 86 86
** ** ** ** ** **
TA Pearson Correlation .871 1 .834 .942 .963 .928 .829
Sig. (2-tailed) .000 .000 .000 .000 .000 .000
N 86 86 86 86 86 86 86
** ** ** ** ** **
NW Pearson Correlation .943 .834 1 .601 .764 .879 .616
Sig. (2-tailed) .000 .000 .000 .000 .000 .000
N 86 86 86 86 86 86 86
** ** ** ** ** **
TL Pearson Correlation .688 .942 .601 1 .933 .809 .825
Sig. (2-tailed) .000 .000 .000 .000 .000 .000
N 86 86 86 86 86 86 86
** ** ** ** ** **
TD Pearson Correlation .789 .963 .764 .933 1 .864 .778
Sig. (2-tailed) .000 .000 .000 .000 .000 .000
N 86 86 86 86 86 86 86
** ** ** ** ** **
OR Pearson Correlation .962 .928 .879 .809 .864 1 .810
Sig. (2-tailed) .000 .000 .000 .000 .000 .000
N 86 86 86 86 86 86 86

http://www.ijmsbr.com Page 34
 International Journal of Management Sciences and Business Research Volume 2, Issue 4- ISSN (2226-8235)

** ** ** ** ** **
OE Pearson Correlation .675 .829 .616 .825 .778 .810 1
Sig. (2-tailed) .000 .000 .000 .000 .000 .000
N 86 86 86 86 86 86 86
**. Correlation is significant at the 0.01 level (2-tailed).
In this table the correlation among all variable has been shown. Especially the correlation between
dependent variable and independent variable has been shown. All the independent variables are
positive correlated with net profit except operating expense. As the result suggests, the association
of operating efficiency (operating revenue) is the highest among all the variables.
6.03 Goodness of Fit test
of variable are normally distributed or not.
The goodness of fit test applies to situation in
Kolmogorov-Smirnov goodness of fit test is
which we want to determine whether a set of
used in the study. This part is done to determine
data may be looked upon as a random sample
whether to do parametric test or non-parametric
from a population having a given distribution.
test.
Normally it is done to find out whether values
Table: 4
One-Sample Kolmogorov-Smirnov Test
NP TA NW TL TD OR OE
N 86 86 86 86 86 86 86
Normal Mean 4.26E8 1.05E10 2.15E9 8.31E9 4.67E9 7.94E8 1.58E8
Para-
a Std. Deviation 7.822E8 1.016E10 4.256E9 7.011E9 5.444E9 1.144E9 1.915E8
meters
Most Absolute .285 .183 .338 .159 .247 .265 .257
Extreme Positive .268 .179 .307 .159 .247 .265 .257
Diffe- Negative -.285 -.183 -.338 -.141 -.196 -.260 -.226
rences
Kolmogorov-Smirnov Z 2.641 1.693 3.137 1.476 2.293 2.461 2.383
Asymp. Sig. (2-tailed) .000 .006 .000 .026 .000 .000 .000
a. Test distribution is Normal.
Hypothesis: Null Hypothesis (H0): The values are normally distributed.
Decision: As the P-value of all variables are greater than 0.05, we cannot reject the null hypothesis.
So all variables‟ values are normally distributed. So we can use parametric test.

6.04 Mean Test Analysis Table: 5

One-Sample Test
Test Value = 0
t df Sig. Mean 95% Confidence Interval of the
(2-tailed) Difference Difference
Lower Upper
NP 5.051 85 .000 4.260E8 2.58E8 5.94E8
TA 9.571 85 .000 1.049E10 8.31E9 1.27E10
NW 4.689 85 .000 2.152E9 1.24E9 3.06E9
TL 10.996 85 .000 8.314E9 6.81E9 9.82E9
TD 7.963 85 .000 4.675E9 3.51E9 5.84E9
OR 6.432 85 .000 7.936E8 5.48E8 1.04E9
OE 7.640 85 .000 1.577E8 1.17E8 1.99E8
Hypothesis: Null Hypothesis: Mean of variable is equal to zero
Decision: The significance level of all variable is lower than 0.05. Therefore, the null hypothesis
should be rejected. So it can be stated that mean of all variable is not equal to zero.
6.05 Simple Regression Analysis

http://www.ijmsbr.com Page 35
 International Journal of Management Sciences and Business Research Volume 2, Issue 4- ISSN (2226-8235)

In this part of report we will start to estimate
simple regression model keeping financial
performance i.e. Net Profit of all company as
dependent variable and all other financial
are summarized in the following table:
Dependent Independent Variable
Variable
Total Asset (TA)
Net Profit (NP)
circumstances indicator as independent variable.
Simple regression model will follow below
format: Y= a + bX; Where, Y= Dependent
variable, a= Y- intercept/constant, b=slope, X=
independent variable. The outputs of regression
Table: 6
Equation R2 F- test p Value of
Value the Model
NP = -2.774+ .871 TA 75.60% 264.78 .000

Total Liability (TL) NP = 5.299+ .688 TL 88.80% 677.88 .000

Net Worth (NW) NP = -2.12+ .238 NW 47.70% 75.512 .000
Term Deposit (TD) NP = -1.03+ .789 TD 61.80% 138.50 .000
Operational Revenue (OR) NP = -9.59+ .962 OR 92.50% 1.044 .000
Operational Expense (OE) NP = -9.27+ .329 OE 45.00% 70.49 .000
Among this 6 performance indicating Operating However, Total Equity has the lowest value of
Revenue have the highest value for R2 (92.50%) R2 (47.70%) and P value (0.456) of F test,
which indicates that this can explain 92.50% of which indicates that this variable has very lower
the variations in profitability over this 4 years of impact on profitability as a predictor (i.e.
time horizon (2008-2011). P- Value (0.00) of F - independent) variable when used in simple
tests at 95% confidence level states that the regression analysis.
result is significant as it is less than 0.05.
6.06 Multiple Regression Model
6.06.1 Model Details Table: 7
Variables Entered/ Removedb
Model Variables Entered Variables Removed Method
1 OE, TA, NW, TL, OR, TD Enter
a. Dependent Variable: NP
6.06.2 ANOVA
Null Hypothesis: independent variables have no combined impact on NBFIs bottom line,
or β1 = β2 = β3 = β4 = β5 = β6 = 0
Alternative Hypothesis: βi >0, where, i=1……6 Table: 8
b
ANOVA
Model Sum of Squares df Mean Square F Sig.
a
1 Regression 5.118E19 5 1.024E19 10.002E3 .000
Residual 8.175E17 80 1.022E16
Total 5.200E19 85
a. Predictors: (Constant), OE,TA, NW, TL, OR, TD
b. Dependent Variable: NP
Explanation: critical F value of 5.11 or 8.17 and the
The SPSS output for ANOVA shows that F significance level .000 is lower than acceptable
value is 10.002 and the level of significance is level of significance .05, we can reject the null
.000. Because the F value is greater than the hypothesis. Table: 9
a
Coefficients
Model Unstandardized Coefficients Standardized t Sig.
Coefficients
B Std. Error Beta
1 (Constant) -3.056E7 2.001E7 -1.527 .131
TA .025 .193 .301 .131 .011
NW .074 .007 .401 10.140 .000
http://www.ijmsbr.com Page 36
 International Journal of Management Sciences and Business Research Volume 2, Issue 4- ISSN (2226-8235)

TL .011 .006 .097 1.758 .003

TD -.029 .008 -.203 -3.582 .001
OR .588 .033 .860 18.085 .000
OE -.781 .115 -.191 -6.774 .000
a. Dependent Variable: NP

6.06.3 Main Model Table: 10

Multiple Regression Model
Model Net Profit = -3.05 + .301 TA+ .097 TL + .401 NW + (-.203) TD + .86 OR + (-.191) OE
Other Statistics for Model
R .992
2
R .983
F- test value 17.482
P- value of F test .000a
Explanation:
Profitability related with performance indicators (c) The relationship among the variables in
in the following ways: relative terms can be estimated with the help
(a) For 1 (one) unit increases in Total Assets, of coefficient of multiple correlations (R).
Total Liability, Net Worth, & Operating R= .992 indicates that there exists a high
Revenue, Net Profit will increase by 0.301 degree of relationship among the variables.
units, 0.097units, 0.401units, & 0.86 units From the value of R2 we can say that all
respectively and vice versa; these 6 predictor variables combined explain
(b) For 1 (one) unit increases in Term Deposit, 98.30% of the variance in Net Profit. The P-
& Operating Expense, Net Profit will value (0.00) of F- test states that the
decrease by 0.203 units, & 0.191 units regression is significant.
respectively and vice versa;
7.00 Model Diagnostic Analysis
Discussion A. Test for Normality Residuals Table: 11
Case Processing Summary
Cases
Valid Missing Total
N Percent N Percent N Percent
Unstandardized Residual 86 100.0% 0 .0% 86 100.0%
Descriptives
Statistic Std. Error
Unstandardized Residual Mean -4.7129254E-8 1.05753423E7
95% Confidence Lower -2.1026614E7
Interval for Mean Bound
Upper 2.1026614E7
Bound
5% Trimmed Mean -1.0088967E6
Median -3.7264290E5
Variance 9.618E15
Std. Deviation 9.80716895E7
Minimum -3.61227E8
Maximum 3.11238E8
Range 6.72465E8
Interquartile Range 8.12592E7
Skewness .132 .260
Kurtosis 3.543 .514

http://www.ijmsbr.com Page 37
 International Journal of Management Sciences and Business Research Volume 2, Issue 4- ISSN (2226-8235)

Tests of Normality
Kolmogorov-Smirnova Shapiro-Wilk
Statistic df Sig. Statistic df Sig.
Unstandardized Residual .139 86 .000 .916 86 .000
a. Lilliefors Significance Correction
Unstandardized Residual Stem-and-Leaf Plot
Frequency Stem & Leaf
4.00 Extremes (=<-2E+008)
5.00 -1. 00013
10.00 -0. 5555678899
24.00 -0. 000001111111112233333444
27.00 0. 000000111111111112222334444
8.00 0. 55577899
2.00 1. 23
6.00 Extremes (>=173582737)
Stem width: 1.0E+008
Each leaf: 1 case(s)

http://www.ijmsbr.com Page 38
 International Journal of Management Sciences and Business Research Volume 2, Issue 4- ISSN (2226-8235)

Explanation:
We now use the examiner command to look at
the normality of these residuals. All of the
results from the examiner command suggest
that the residuals are not fully normally
distributed the skewness and kurtosis are near 0,
the "tests of normality" are not significant, the
histogram looks normal, and the Q-Q plot looks
normal. Based on these results, the residuals
from this regression appear to conform to the
assumption of being normally distributed.

Discussion B: Hetrocedasticiy Test:

Explanation: The residuals looked good so there is no problem of heterocedasticy.

Discussion C: Multi-collinearity test Table: 12
a
Coefficients
Model Unstandardized Standardized t Sig. Collinearity Statistics
Coefficients Coefficients
B Std. Error Beta Tolerance VIF
1 (Constant) -3.056E7 2.001E7 -1.527 .131
TA .025 .193 .901 .131 .899 .000 6.516
NW .074 .007 .401 10.140 .000 .126 7.968
TL .011 .006 .097 1.758 .083 .064 5.635
TD -.029 .008 -.203 -3.582 .001 .061 6.272
OR .588 .033 .860 18.085 .000 .087 1.515
OE -.781 .115 -.191 -6.774 .000 .247 4.053
a. Dependent Variable: NP

http://www.ijmsbr.com Page 39
 International Journal of Management Sciences and Business Research
Explanation:
As the VIF Value is less than 10 so there exists no Multi-collinearity Problem.
8.00 Findings & Conclusion
According to our study it is clear that the
profitability IS INFLUENCED BY HOST the
independent variables SUCH AS Total Asset,
Term Deposit, Operating Revenue, and
Operating Expenses. As we know that Total
asset is considered as one of the most prominent
yardstick of financial stability measurement of
financial institutions, stakeholders generally
perceive the financial institutions to be superior
over the others if it total asset is higher than
other institutions. When an NBFI has huge
Operating Revenue and Total Equity the
investors feel more secured and approach to this
NBFI for their investment. As the number of
customers increases it results in more profitable
organization. Again we see operating revenue is
the another variable which has a major impact
on net profit. So it is undoubtedly true that if the
revenue increases, ultimately it has a positive
effect over the profitability.
The results of multiple regressions suggest that
the selected independent variables explain more
than 98.30% changes in the net profit. By
analyzing the other statistical results of multiple
regressions we found that the results are very
much consistent with the simple regression. All
the results are statistically significant and
overall provide an idea that liquidity is the basic
determinant of profitability in NBFI sector. So it
can be inferred that this promising and potential
sector in Bangladesh can flourish very fast and
enhance profitability by improving total equity
and operating efficiency.
The findings of the paper is not conclusive
rather informative. It leaves room for further
study in different functional areas of NBFIs
using Data Envelopment Analysis (DEA),
CAMELS rating, robust estimation approach
based on the competing efficient structure (ES)
hypothesis, effect of commercial property price
movements, use of statistical tools and more.
Moreover, the bindings of government policies
over the period particularly both pre and post
http://www.ijmsbr.com
Volume 2, Issue 4- ISSN (2226-8235)
financial crisis regime on the performance of
NBFI have not been considered.
Bibliography
[1] Abbasoglu, O. F., Aysan, A. F., & Gunes, A.
(2007). Concentration, competition, efficiency
and profitability of the Turkish banking sector
in the post-crisis period. Banks and Bank
Systems 2(3), 106–115.
[2] Akhavein, J., Berger, A. N., & Humphrey,
D. B. (1997). The effects of megamergers on
efficiency and prices: Evidence from a bank
profit function. Review of Industrial
Organization 12(1), 95–139.
[3] Athanasoglou, P. P., Brissimis, S. N., &
Delis, M. D. (2008). Bank specific, industry
specific and macroeconomic determinants of
bank profitability. Journal of International
Financial Markets, Institutions and Money
18(2), 121–136.
[4] Beck, T., Demirguc-Kunt, A., & Levine, R.
(2009). Financial institutions and markets across
countries and over time: Data and analysis.
World Bank Policy Research Working Paper
No. 4943.
[5] Ben Naceur, S., & Goaied, M. (2008). The
determinants of commercial bank interest
margin and profitability: Evidence from Tunisia.
Frontiers in Finance and Economics 5(1), 106–
130.
[6] Berger, A. N. (1995). The relationship
between capital and earnings in banking.
Journal of Money, Credit and Banking 27, 432–
456.
[7] Berger, A. N., Hanweck, G. A., &
Humphrey, D. B. (1987). Competitive viability
in banking: Scale scope and product mix
economies. Journal of Monetary Economics
20(3), 501–520.
[8] Bikker, J., & Hu, H. (2002). Cyclical
patterns in profits, provisioning and lending of
banks and procyclicality of the new basel capital
requirements. BNL Quarterly Review 221, 143–
175.
Page 40
 International Journal of Management Sciences and Business Research
[9] Bourke, P. (1989). Concentration and other
determinants of bank profitability in Europe,
North America and Australia. Journal of
Banking and Finance 13, 65–79.
[10] Boyd, J., & Runkle, D. (1993). Size and
performance of banking firms: Testing the
predictions theory. Journal of Monetary
Economics 31, 47–67.
[11] Cooper, M., Jackson, W., & Patterson, G.
(2003). Evidence of predictability in the cross
section of bank stock returns. Journal of
Banking and Finance 27, 817–850.
[12] Christos K. Staikouras & Geoffrey E.
Wood “The Determinants of European Bank
Profitability”, International Business &
Economics Research Journal Volume 3,
Number 6
[13] Davydenko A., (2011) "Determinants of
Bank Profitability in Ukraine," Undergraduate
Economic Review, 7, 1-30.
[14] Demirguc-Kunt, A., & Huizinga, H.
(1999). Determinants of commercial bank
interest margins and profitability: Some
international evidence. World Bank Economic
Review 13, 379–408.
[15] Duca, J., & McLaughlin, M. (1990).
Developments affecting the profitability of
commercial banks. Federal Reserve Bulletin,
477–499.
[16] Fadzlan Sufian, and Royfaizal Razali
Chong “Determinants of Bank profitability in a
developing economy: Empirical evidence from
the Philippines”, AAMJAF, Vol. 4, No. 2, 91–
112, 2008
[17] Goddard, J., Molyneux, P., & Wilson, J.
(2004). Dynamic of growth and profitability in
banking. Journal of Money, Credit and Banking
36, 1069–1090.
[18] Golin, J. (2001). The Bank Credit Analysis
Handbook: A Guide for Analysts, Bankers and
Investors. New York: John Wiley and Sons.
[19] Hassan, M. K., & Bashir, A. H. M. (2003).
Determinants of Islamic banking profitability.
Paper presented at the 10th ERF Annual
Conference, Morocco, 16–18 December.
[20] Hauner, D. (2005). Explaining efficiency
differences among large German and Austrian
banks. Applied Economics 37, 969–980.
http://www.ijmsbr.com
Volume 2, Issue 4- ISSN (2226-8235)
[21] Jahangir N., Shill S. and Haque A. J.,
(2011) „Examination of profitability in the
context of Bangladesh banking industry‟, ABAC
Journal, 27, 36-46.
[22] James W. Scott and José Carlos Arias
“Banking profitability determinants”, Business
Intelligence Journal - July, 2011 Vol.4 No.2
[23] Kosmidou, K. (2008). The determinants of
banks' profits in Greece during the period of EU
financial integration. Managerial Finance 34(3),
146–159.
[24] Levine, R. (1998). The legal environment,
banks, and long run economic growth. Journal
of Money, Credit and Banking 30, 596–613.
[25] Mamatzakis, E. C., & Remoundos, P. C.
(2003). Determinants of Greek commercial
banks profitability, 1989–2000. Spoudai 53(1),
84–94.
[26] Miller, S. M., & Noulas, A. (1997).
Portfolio mix and large bank profitability in the
USA. Applied Economics 29, 505–512.
[27] Molyneux, P., & Thornton, J. (1992).
Determinants of European bank profitability: A
note. Journal of Banking and Finance 16, 1173–
1178.
[28] Molyneux, P. (1993). Structure and
performance in European Banking. Working
paper, University of Wales Bangor.
[29] Pasiouras, F., & Kosmidou, K. (2007).
Factors influencing the profitability of domestic
and foreign commercial banks in the European
Union. Research in International Business and
Finance 21, 222–237.
[30] Rajan, R. G., & Zingales, L. (1998).
Financial dependence and growth. American
Economic Review 88, 559–586.
[31] Rivard, R. J., & Thomas, C. R. (1997). The
effect of interstate banking on large bank
holding company profitability and risk. Journal
of Economics and Business 49, 61–76.
[32] Shah-Noor Rahman, Tazrina Fara / IJAR-
BAE (March 2012) Vol. 1, Issue 1 / Page No: 26
– 32
[33] Staikouras, C., & Wood, G. (2003). The
determinants of bank profitability in Europe.
Paper presented at the European Applied
Business Research Conference, Venice, 9–13
June.
Page 41
 International Journal of Management Sciences and Business Research
[34] Staikouras, C., Mamatzakis, E., &
Koutsomanoli-Filippaki, A.(2008). An empirical
investigation of operating performance in the
new European banking landscape. Global
Finance Journal 19(1),32–45.
[35] Stiroh, K. J., & Rumble, A. (2006). The
dark side of diversification: The case of US
financial holding companies. Journal of
Banking and Finance 30(8), 2131–2161.
[36] Thakor, A. (1987). Discussion. Journal of
Finance 42, 661–663.
http://www.ijmsbr.com
Volume 2, Issue 4- ISSN (2226-8235)
[37] Whalen, G. (1988). Actual competition,
potential competition and bank profitability in
rural markets. Federal Reserve Bank of
Cleveland Economic Review 3, 14–21.
[38] White, H. J. (1980). A heteroskedasticity-
consistent covariance matrix estimator and a
direct test for heteroskedasticity. Econometrica
48, 817–838.
Page 42